Traders Turn Bearish on Chip ETFs Amid Volatile Options Activity
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 51 minutes ago
0mins
Source: CNBC
- Shifting Trading Sentiment: In the VanEck Semiconductor ETF (SMH), put options volume more than doubled that of calls on Monday morning, indicating skepticism about the ETF's bounce, particularly with over 10% of the $217 million in premiums tied to 550 puts.
- Marvell Technology's Performance: Despite the overall bearish sentiment, Marvell saw calls outnumber puts three to one, with over 80% of premiums concentrated in this stock, reflecting investor optimism following its inclusion in the S&P 500.
- Intel's AI Chip Orders: Alphabet reportedly commissioned Intel to produce 3 million in-house AI chips, leading to options volume in Intel trending nearly twice its daily average, with over 70% of that volume tied to calls, showcasing market confidence in its future performance.
- Cerebras' Options Frenzy: Cerebras also experienced a surge in options activity, with more than $50 million in premiums predominantly linked to calls, indicating strong investor enthusiasm for its growth potential.
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Analyst Views on CBRS
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About CBRS
Cerebras Systems Inc. is an artificial intelligence (AI) infrastructure company that designs and manufactures an AI compute platform comprised of proprietary systems and software. The Company's products include inference Cloud, Training Cloud, CS-3 system, AI supercomputer, Wafer Scale Engine and model development. The Company's pioneering Wafer-Scale Engine (WSE), a chip encompassing an entire silicon wafer, was specifically designed to enable higher performance and speeds than GPUs for the computational demands of inference, Generative AI (GenAI), and other AI applications. It offers deployment services to assist customers with data preparation, model architecture design, training management, inference optimization, and, in select cases, ongoing system operations and management. It also offers a subscription service providing access to an ongoing stream of software updates and upgrades for purchasers of its hardware.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Cerebras Shares Rebound as Wall Street Initiates Coverage
- Positive Market Reaction: Cerebras shares rose 5% in premarket trading on Monday, reflecting investor confidence in the newly public chipmaker, particularly after Wall Street initiated coverage, indicating recognition of its unique capabilities.
- Large Financing Scale: Cerebras raised $5.55 billion in its IPO at a price of $185 per share, opening at $350, which, despite subsequent declines, demonstrates strong market demand and investor interest.
- Optimistic Analyst Ratings: Morgan Stanley rated Cerebras as 'Overweight' with a price target of $250, highlighting its unique advantages in AI infrastructure, especially as demand for fast inference grows, positioning the company for significant benefits.
- Significant Collaboration Potential: Needham analysts noted Cerebras' $20 billion compute deal with OpenAI and collaboration with AWS, underscoring its unique position in fast inference workloads and the potential for substantial revenue growth in the future.
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US Stocks Rebound Led by Chipmakers Amid Geopolitical Tensions
- Market Rebound: The S&P 500 Index rose by 1.01%, the Dow Jones Industrial Average increased by 0.46%, and the Nasdaq 100 Index climbed by 2.39%, indicating a recovery from last Friday's selloff, particularly driven by strong performances in chipmakers and AI infrastructure stocks.
- Oil Price Volatility: WTI crude oil prices initially surged over 4% due to escalating tensions between Iran and Israel but retreated after Iran announced an end to its military operations, alleviating pressure on the stock market as expectations for a ceasefire emerged.
- Interest Rate Expectations: The market is pricing in only a 3% chance of a 25 basis point rate hike at the next FOMC meeting, reflecting a cautious outlook among investors, especially following robust nonfarm payroll data, which could influence bond market dynamics.
- Tech Stock Surge: Intel's stock surged by 11% after Google placed an order for three million Tensor Processing Units, driving a broader rally in chip stocks, highlighting the tech sector's critical role in the market recovery and potentially attracting more investor interest in related equities.
See More
Traders Turn Bearish on Chip ETFs Amid Volatile Options Activity
- Shifting Trading Sentiment: In the VanEck Semiconductor ETF (SMH), put options volume more than doubled that of calls on Monday morning, indicating skepticism about the ETF's bounce, particularly with over 10% of the $217 million in premiums tied to 550 puts.
- Marvell Technology's Performance: Despite the overall bearish sentiment, Marvell saw calls outnumber puts three to one, with over 80% of premiums concentrated in this stock, reflecting investor optimism following its inclusion in the S&P 500.
- Intel's AI Chip Orders: Alphabet reportedly commissioned Intel to produce 3 million in-house AI chips, leading to options volume in Intel trending nearly twice its daily average, with over 70% of that volume tied to calls, showcasing market confidence in its future performance.
- Cerebras' Options Frenzy: Cerebras also experienced a surge in options activity, with more than $50 million in premiums predominantly linked to calls, indicating strong investor enthusiasm for its growth potential.
See More
Apple's Developer Conference Boosts Stock Amid AI Strategy Reveal
- Apple Stock Surge: Apple's shares rose over 2% as its Worldwide Developers Conference commenced, with expectations to unveil its artificial intelligence strategy, including updates to Siri, which could further solidify its leadership in the tech industry.
- Wix Lowers Outlook: Wix.com saw its stock drop more than 5% after revising its full-year bookings growth forecast to the low teens percentage rate, down from mid-teens, which may negatively impact market confidence and investor sentiment.
- Crocs Rating Upgrade: Crocs' shares increased by 3% following Baird's upgrade to outperform, indicating a healthier narrative emerging in the North American market, which enhances investor confidence in its future growth prospects.
- Cerebras Stock Surge: Cerebras Systems experienced a 20% stock increase after several Wall Street firms initiated coverage with buy ratings, reflecting strong market confidence in its AI chip technology, potentially boosting its competitiveness in the rapidly evolving AI sector.
See More
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- Market Rebound: The S&P 500 Index rose by 0.65%, the Dow Jones Industrial Average increased by 0.21%, and the Nasdaq 100 climbed by 1.59%, indicating market resilience following last week's sell-off, particularly driven by strong performances in chipmakers and AI infrastructure stocks.
- Oil Price Volatility: Crude oil prices fell from highs after Iran announced an end to its military operations against Israel, despite initially surging over 4% amid escalating conflict, highlighting the direct impact of geopolitical tensions on market sentiment.
- Interest Rate Expectations: The market is pricing in only a 1% chance of a 25 basis point rate hike at the upcoming FOMC meeting in June, reflecting cautious investor sentiment regarding future monetary policy, especially in light of stronger-than-expected US nonfarm payroll data.
- Stock Performances: In the stock market, Micron Technology surged over 9%, leading gains in the S&P 500 and Nasdaq 100, showcasing the recovery potential of the chip sector, while Nurix Therapeutics jumped over 17% after agreeing with Roche on a deal worth up to $2.3 billion.
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- Chip Market Rebound: Following last Friday's brutal sell-off, the S&P 500 and Nasdaq are set for higher opens, with Nvidia and Broadcom shares rising approximately 2.5% and 3.3%, respectively, indicating a recovery in investor confidence in the chip sector that could positively influence overall market sentiment.
- Cerebras Systems IPO Ratings: Wall Street analysts have initiated coverage on the recently listed Cerebras Systems with nearly unanimous buy ratings, despite the stock trading only about 15% above its $185 offering price since its debut on May 14, reflecting cautious optimism regarding its future growth potential.
- Google-SpaceX Contract: Google has agreed to pay SpaceX $920 million per month for the use of its rockets and AI chips, a move aimed at ensuring capacity to meet surging demand for Gemini Enterprise, indicating Google's strategic investment intentions in the AI sector that may impact its future technological landscape.
- Micron Price Target Upgrade: Wells Fargo raised Micron's price target from $550 to $1,220, with analysts anticipating a surge in memory demand to drive stock price increases, showcasing strong market confidence in the company's future performance as its shares rose nearly 7% today.
See More
Cerebras Shares Rebound as Wall Street Initiates Coverage
- Positive Market Reaction: Cerebras shares rose 5% in premarket trading on Monday, reflecting investor confidence in the newly public chipmaker, particularly after Wall Street initiated coverage, indicating recognition of its unique capabilities.
- Large Financing Scale: Cerebras raised $5.55 billion in its IPO at a price of $185 per share, opening at $350, which, despite subsequent declines, demonstrates strong market demand and investor interest.
- Optimistic Analyst Ratings: Morgan Stanley rated Cerebras as 'Overweight' with a price target of $250, highlighting its unique advantages in AI infrastructure, especially as demand for fast inference grows, positioning the company for significant benefits.
- Significant Collaboration Potential: Needham analysts noted Cerebras' $20 billion compute deal with OpenAI and collaboration with AWS, underscoring its unique position in fast inference workloads and the potential for substantial revenue growth in the future.
See More
US Stocks Rebound Led by Chipmakers Amid Geopolitical Tensions
- Market Rebound: The S&P 500 Index rose by 1.01%, the Dow Jones Industrial Average increased by 0.46%, and the Nasdaq 100 Index climbed by 2.39%, indicating a recovery from last Friday's selloff, particularly driven by strong performances in chipmakers and AI infrastructure stocks.
- Oil Price Volatility: WTI crude oil prices initially surged over 4% due to escalating tensions between Iran and Israel but retreated after Iran announced an end to its military operations, alleviating pressure on the stock market as expectations for a ceasefire emerged.
- Interest Rate Expectations: The market is pricing in only a 3% chance of a 25 basis point rate hike at the next FOMC meeting, reflecting a cautious outlook among investors, especially following robust nonfarm payroll data, which could influence bond market dynamics.
- Tech Stock Surge: Intel's stock surged by 11% after Google placed an order for three million Tensor Processing Units, driving a broader rally in chip stocks, highlighting the tech sector's critical role in the market recovery and potentially attracting more investor interest in related equities.
See More
Traders Turn Bearish on Chip ETFs Amid Volatile Options Activity
- Shifting Trading Sentiment: In the VanEck Semiconductor ETF (SMH), put options volume more than doubled that of calls on Monday morning, indicating skepticism about the ETF's bounce, particularly with over 10% of the $217 million in premiums tied to 550 puts.
- Marvell Technology's Performance: Despite the overall bearish sentiment, Marvell saw calls outnumber puts three to one, with over 80% of premiums concentrated in this stock, reflecting investor optimism following its inclusion in the S&P 500.
- Intel's AI Chip Orders: Alphabet reportedly commissioned Intel to produce 3 million in-house AI chips, leading to options volume in Intel trending nearly twice its daily average, with over 70% of that volume tied to calls, showcasing market confidence in its future performance.
- Cerebras' Options Frenzy: Cerebras also experienced a surge in options activity, with more than $50 million in premiums predominantly linked to calls, indicating strong investor enthusiasm for its growth potential.
See More
Apple's Developer Conference Boosts Stock Amid AI Strategy Reveal
- Apple Stock Surge: Apple's shares rose over 2% as its Worldwide Developers Conference commenced, with expectations to unveil its artificial intelligence strategy, including updates to Siri, which could further solidify its leadership in the tech industry.
- Wix Lowers Outlook: Wix.com saw its stock drop more than 5% after revising its full-year bookings growth forecast to the low teens percentage rate, down from mid-teens, which may negatively impact market confidence and investor sentiment.
- Crocs Rating Upgrade: Crocs' shares increased by 3% following Baird's upgrade to outperform, indicating a healthier narrative emerging in the North American market, which enhances investor confidence in its future growth prospects.
- Cerebras Stock Surge: Cerebras Systems experienced a 20% stock increase after several Wall Street firms initiated coverage with buy ratings, reflecting strong market confidence in its AI chip technology, potentially boosting its competitiveness in the rapidly evolving AI sector.
See More
US Stocks Rebound Modestly Led by Chipmakers
- Market Rebound: The S&P 500 Index rose by 0.65%, the Dow Jones Industrial Average increased by 0.21%, and the Nasdaq 100 climbed by 1.59%, indicating market resilience following last week's sell-off, particularly driven by strong performances in chipmakers and AI infrastructure stocks.
- Oil Price Volatility: Crude oil prices fell from highs after Iran announced an end to its military operations against Israel, despite initially surging over 4% amid escalating conflict, highlighting the direct impact of geopolitical tensions on market sentiment.
- Interest Rate Expectations: The market is pricing in only a 1% chance of a 25 basis point rate hike at the upcoming FOMC meeting in June, reflecting cautious investor sentiment regarding future monetary policy, especially in light of stronger-than-expected US nonfarm payroll data.
- Stock Performances: In the stock market, Micron Technology surged over 9%, leading gains in the S&P 500 and Nasdaq 100, showcasing the recovery potential of the chip sector, while Nurix Therapeutics jumped over 17% after agreeing with Roche on a deal worth up to $2.3 billion.
See More
Chipmakers Rebound Boosts Market Outlook
- Chip Market Rebound: Following last Friday's brutal sell-off, the S&P 500 and Nasdaq are set for higher opens, with Nvidia and Broadcom shares rising approximately 2.5% and 3.3%, respectively, indicating a recovery in investor confidence in the chip sector that could positively influence overall market sentiment.
- Cerebras Systems IPO Ratings: Wall Street analysts have initiated coverage on the recently listed Cerebras Systems with nearly unanimous buy ratings, despite the stock trading only about 15% above its $185 offering price since its debut on May 14, reflecting cautious optimism regarding its future growth potential.
- Google-SpaceX Contract: Google has agreed to pay SpaceX $920 million per month for the use of its rockets and AI chips, a move aimed at ensuring capacity to meet surging demand for Gemini Enterprise, indicating Google's strategic investment intentions in the AI sector that may impact its future technological landscape.
- Micron Price Target Upgrade: Wells Fargo raised Micron's price target from $550 to $1,220, with analysts anticipating a surge in memory demand to drive stock price increases, showcasing strong market confidence in the company's future performance as its shares rose nearly 7% today.
See More
